Skills gaps and staff shortages in the UK are creating high-pressure cultures that are becoming unsustainable for employees.
That’s one key takeaway from a new report on the top human resources (HR) challenges testing leaders this year.
The three-pronged category of skills gaps, upskilling, and reskilling (29.3%) has emerged as the leading HR challenge for employers in the UK, climbing from fifth position in 2024, according to research from SD Worx, a European HR company. Other top challenges facing UK employers include talent acquisition and recruitment (28%), employee wellbeing (27.7%), employee experience and engagement (27.3%), and employee retention and turnover (27%).
According to the report, which surveyed 5,625 HR professionals and 16,000 employees across 16 countries in Europe in February, employee wellbeing emerged as the top concern across all of Europe. While UK employers ranked employee wellbeing concerns third, the accumulation of internal HR challenges could reach a retention crisis for companies, as growing performance pressures push wellbeing strains to the surface.
In response to those pressures, 56% of employees in Europe and 52% in the UK described their jobs as “mentally demanding and stressful”, and 42% in the UK said their health has been affected by this pressure.
The hidden cost of high-pressure cultures
Workers attribute these “high stress” environments to “lack of capacity”, as 40% state there aren’t enough people in their team to manage workload demands, according to the report.
UK employers share employees’ resourcing concerns: 41% have reported staff shortages, with 43% expecting those shortages to worsen this year, the report said. In Europe, 46% reported staff shortages, with 53% expecting the shortages to worsen.
According to wellbeing expert Leanne Spencer, the less room leaders leave for employees to recover from periods of high demand, the more an employee’s capacity to perform diminishes.
If leaders start to think about the cadence of their business, the pace at which they do business, they’d be better at managing burnout, Spencer said in an interview with FM.
Consequently, as staffing gaps catalyse performance pressures, nearly one in four UK employees (24%) and nearly one in five European employees (18%) have had to take time off in the past year due to mental health issues.
Expecting employees to constantly “push through” to get things done is not sustainable, Spencer said. “Because in a lot of ways, business is a lot more predictable than we think … [and] it would take a bit of a load off people if we were able to tell them when we definitely need them at full capacity.”
Upskilling is not just a priority for employers
Learning new skills to advance in their organisations is top of mind for some employees in the SD Worx report.
Despite serious wellbeing impacts, some employees in the UK plan to stay loyal to their companies, the report said. Fourteen per cent of employees are actively looking for another job, but 14% said they would prefer to change roles under their current employer.
This echoes the findings of AICPA & CIMA research published earlier this year. The study found that more than four-fifths of workers at UK small- and medium-size entities want to upskill, but only 31% said they had received formal training that stretched beyond their company’s mandatory requirements in the last 12 months.
As talent acquisition and recruitment challenges persist for employers, closing skills gaps could become fundamental to retaining talent in 2025, the AICPA & CIMA report found, as more opportunity for internal mobility is paramount for some employees this year.
“To navigate the evolving demands of the future, more effort is needed to bridge the skills gap, invest in relevant training, and embrace technology advancements as they come,” the AICPA & CIMA report said.
— To comment on this article or to suggest an idea for another article, contact Steph Brown at Stephanie.Brown@aicpa-cima.com.
AICPA & CIMA MEMBER RESOURCES
Articles
“Pave the Way: Neurodivergent Leaders Can Make a ‘Huge Difference’”, FM magazine, 4 April 2025
“I’m Not Learning New Skills at My Company — What Do I Do?”, FM magazine, 3 April 2025
“Upskilling Doesn’t Always Lead to Internal Progression”, FM magazine, 2 April 2025
“Who Cares? Companies That Care Are Better Positioned With Talent”, Journal of Accountancy, 13 January 2025
